Global scenario creates uncertainty about Petrobras’ debt target, CEO tells CNN

Mar 16, 2020

The price war between Saudis and Russians in the oil market and the slowdown in the global economy due to the coronavirus generate uncertainties about Petrobras’ achievement of its debt reduction targets in 2020, the state company’s president told CNN Brasil.

The company had as a goal to reach the leverage measured by the net debt to EBITDA indicator of 1.5 times by the end of this year.

“Petrobras still has a debt that is more than twice its cash generation. Usually, a commodity producing company is comfortable with indicators below twice (cash generation). We intended to do that (reduce debt) this year … Let’s see if this is feasible or not. It is a question mark now, which did not exist before, ”said the CEO, Roberto Castello Branco.

“Our economic results will be affected, of course. As an oil company, its profitability is affected by oil prices, ”added the executive, according to a publication on the broadcaster’s website.

The president of Petrobras, however, pointed out that the company has done its financial homework, with a more comfortable situation than five years ago, but he stressed seeing the debt as still high.

He also stated that the global scenario has not impacted the company’s divestment plans, such as the sale of refineries. “We did not receive any sign of withdrawal, lack of enthusiasm, from those interested in purchasing refineries. On the contrary: we have potential buyers visiting refineries, ”said Castello, according to CNN.

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